Spanish prime minister lambasts Catalan independence drive

MADRID, Aug 4 (Reuters) - Spanish Prime Minister Mariano
Rajoy on Tuesday lambasted Catalan plans to test support for
independence by holding a regional election, saying he would not
allow anyone to break up Spain or to derail an economic
recovery.

Rajoy's broadside against Catalan President Artur Mas's
scheduling of regional elections for Sept. 27 came as his
government presented a 2016 budget intended to show the ruling
People's Party as the best qualified to maintain economic
stability after national elections due by the end of the year.

Spain's recovery is gathering strength after years of deep
economic crisis. The economy grew at its fastest since 2007 in
the second quarter and unemployment is falling, although it
remains above 20 percent.

Mas announced elections for the Catalan parliament on Monday
evening, bringing them forward by a year and portraying them as
a proxy vote on independence after Rajoy's government went to
court last year to block a referendum on the northeastern region
breaking away from Spain.

Rajoy ruled out Catalan independence and said he hoped the
regional elections would put an end to the "discord, division
and confrontation" created by the Catalan independence push.

"We can't go on with this situation much longer," he told
reporters in Huelva in southern Spain. "Nobody is going to break
up Spain ... Nobody is going to turn the citizens of Catalonia
into foreigners in their own country."

"We will absolutely not allow political instability created
by some people's decisions to affect the economic recovery," he
said.

Separatist leaders have said in recent weeks that a victory
for them in the election would launch a "roadmap" to Catalan
independence within 18 months, although they have not said how
they would overcome the staunch opposition from Madrid.

Catalan separatist campaigners defied Madrid and staged a
symbolic vote on independence last November. About 80 percent of
the 2.2 million people who voted backed secession, but the
turnout was little more than 40 percent.

Their fervour was boosted by a Scottish referendum on
independence from Britain, even though it ended in a 'no' vote.

Apart from Catalan nationalism, Rajoy faces new political
challenges from the rise of the anti-austerity Podemos party and
the centrist Ciudadanos (Citizens) group.

After leading the polls as recently as April, Podemos
slipped to third in a recent Metroscopia poll, with the
centre-right People's Party and opposition Socialist Party vying
neck-to-neck for the lead.

The government presented the 2016 budget to parliament on
Tuesday - two months early. The government said it wanted the
budget approved before the national election to avoid market
uncertainty, but it drew accusations of electioneering from
Socialists and the unions. [ID:nL5N10B39X}

The budget holds out the prospect of an easing of austerity
if the People's Party is re-elected, promising spending
increases, tax cuts and a pay rise for civil servants.
(Additional reporting by Blanca Rodriguez; Editing by Angus
MacSwan)